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Unemployment Claims Give Fed More Ammo

ilene's picture




 

Unemployment Claims Give Fed More Ammo

Courtesy of Lee Adler of the Wall Street Examiner

An analysis of the actual, not seasonally manipulated and massaged unemployment claims data shows some deterioration in employment, week to week. Weakening employment data has raised expectations for Fed action. 

Actual initial claims rose by 9,355. In the same week last year they were down by 1,273. The average increase in new claims in the pre Labor Day week over the past 5 years was 4,293. Including just 2007-2010, the average was +3,300. Therefore this week's number is worse than last year, worse than the average of the past 5 years, and worse than the past 4 years since the depression began in terms of the increase in new claims since the previous week.

The total number of claims at 346,065 is better than last year's 381,838 and 2009's 466,277 during the same week, and slightly better than 2008's 358,730, but it remains significantly elevated versus 2007's 257,454, and 2006's 259,539.

Actual First Time Unemployment Claims Chart- Click to enlarge

New claims as a percentage of eligible covered workers were 0.275%. That compares with 0.301% during the same week last year and 0.350% in 2009. This year is worse than the 0.268% in 2008 and 0.195% in 2007, just before the economy collapsed. 

New Unemployment Claims Percent of Eligible Chart- Click to enlarge

Analysis of continuing claims is clouded by the fact that continuing claims can decline due to claimants becoming employed, or by exhausting benefits. Claims have been in a steadily declining trend, but there is no way of determining how much of the decline is due to new employment and how much is due to claimants exhausting benefits. The rate of decline in Federal extended benefit programs has been faster than in regular state programs. I suspect that this is due to greater numbers of people exhausting these benefits than the number moving from the state program to the extended benefit program.

Continuing Unemployment Claims Chart- Click to enlarge

The Fed has been floating trial balloons almost daily about different stimulative steps it could take. The claims data is just more grist for the mill. The consensus seems to be that the Fed will make like Chubby Checker and do the Twist, swapping out short duration Treasuries for longer term notes and bonds. There's also discussion of cutting the rate paid on bank reserves to zero. Additional money printing (aka QE) has been all but ruled out for the time being.

With QE ruled out, the real impact of either of the other proposed actions will be nil, but that won't stop the market from speculating about it and percolating higher heading into the announcement on September 21. Once the new program is made official, whatever it is, it could be a quintessential sell the news moment. That would not apply if the Fed actually announces another round of outright money printing a la QE2. 

 

For more, try the Wall Street Examiner Professional Edition risk free for 30 days. 

 

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Wed, 09/14/2011 - 03:06 | 1666849 chinawholesaler
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Fri, 09/09/2011 - 01:43 | 1649673 FederalReserveB...
FederalReserveBankofTerror's picture

Work at a food shelf any day of the week and witness the desperation, the crying, wailing, pleading. Just because one is on food assistance it does not mean they are not hungry. Try living on $200/month for a total food budget for someone who has exceeded their 99 weeks of unemployment and who are still unemployed. There are around 46,000,000 people on food assistance. There are currently 12,000,000 people in danger of dying of hunger or thirst in Somalia...perhaps that puts things in perspective. No COLA for folks on social security, shrinking packages, including the size of grocery bags and skyrocketing prices/quantity ie. ounces, pounds, grams liters etc. QE3 will absolutely drive the masses to desperate acts to stay alive and bankers bathe in multimillion dollar bonuses. Wealth is being redistributed, from the poor and middle class to the super rich!

The Federal Reserve Bank Is a Terrorist Organization, PERIOD! 

9/11 is a cake walk compared to the inflation inspired, Fed originated Arab Spring. The Federal Reserve Bank is a criminal organization.

Barack Obama should declare The Federal Reserve Financial Terrorists and direct special forces to storm the offices of the Fed and the Primary Dealers Headquarters and branches in the US. 

By Executive order under the Powers vested in the President under the Patriot Act seize the records of the Fed and the Primary dealers and rescind the Federal Reserve Act. The US treasury would replace the plates of FRNs on the printing presses with US Dollar Bills to be eventually backed by Gold as the world transitions to a debt free dollar and fractional reserve banking is outlawed.

Abolish the Federal Income tax and move to a national sales tax to fund the basics and enable the US to defend itself from threats both foreign and domestic without policing the world.

Our economy would instantly become more local and millions of jobs would return to the US in short order.

 

Problem Solved!

The Republican VS Democrat debate is a smokescreen as the constitution burns and every day we become indentured servants more tightly shackled by international bankers to "unrepayable", generational debt.

When the assets of the Fed and PMs are seized a full accounting of every Treasury will be made and printed so it exists in physical form and then pressed into kerosene soaked bales of voided treasuries. By Presidential Executive Order The Federal Reserve Bank at 

2000 L Street Northwest

Washington D.C., DC 20006

will be razed, the ruins will be carted away and the pit will be lined like a burial vault the bales of treasuries will be burned in the pit/vault formerly occupied by the Federal Reserve bank to be completely sewed in salt, much like Rome did to Carthage. In the center of the square will be a bronze statue of President Ron Paul dressed in body armor made of gold with a golden sword in one hand and the head of a bearded hydra in the other with other headless hydra necks popping from the earth with their decapitated heads adorning Freedom Plaza.  

A Plaque will read, "NEVER AGAIN!"

williambanzai7 Please feel free to render this scene :)


 

Thu, 09/08/2011 - 22:58 | 1649432 Soul Train
Soul Train's picture

what an idiotic commentary piece by Lee Adler.

at least he confesses knowledge that the Fed uses the media to launch their trial balloon policy ideas.

A sham. A circus. A farce. The Big Lie. It all describes the Fed.

Buy gold coin and silver specimen. CaLL their bluff.

Thu, 09/08/2011 - 19:56 | 1648610 apberusdisvet
apberusdisvet's picture

"specific, credible threat on anniversary of 9/11"

Another false flag attack?  O's poll numbers really suck.  I am really cynical today for some reason.

Thu, 09/08/2011 - 19:29 | 1648411 sgt_doom
sgt_doom's picture

BTW, great bog post, Ilene, as usual....

Thu, 09/08/2011 - 17:15 | 1647818 Robslob
Robslob's picture

Therefore this week's number is worse than last year, worse than the average of the past 5 years, and worse than the past 4 years since the depression began in terms of the increase in new claims since the previous week.

And will continue on this trajectory as long as the Fed and Government try to "fix" everything.

More monetization leading to higher unemployment therefore requiring even more monetization which will lead to even higher unemployment which will then require..........I think we get the pattern.

Thu, 09/08/2011 - 19:25 | 1648381 sgt_doom
sgt_doom's picture

To further break it down:

debt deflation thanks to trillions of dollars of worthless credit derivatives, and ever-increasing unemployment due to endless jobs offshoring, importation of scab workers, human trafficking, etc.

And since July of 1999, ZERO net new jobs creation --- and still in net job LOSS when comparing the wages and hours of old jobs loss against the ever decreasing new jobs created.......

Thu, 09/08/2011 - 16:41 | 1647698 ebworthen
ebworthen's picture

Add in the hundreds of thousands (millions) whose unemployment ran out in the past year or two because they were laid off in 2008-2009 and it is a lot worse than reported numbers.

Too bad they don't have statistics for kids living in parents basements or vice-versa, or group houses and room rentals.

All you have to do is talk to people and listen.  Been to your local food bank lately?  Hmmm...

We are in a DEPRESSION.  If it weren't for Food Stamps, WIC, Welfare, a large number in the military, and Credit Cards there would be riots and soup lines a la' 1934.

We are there, masked by selling out the savers, retirees, taxpayers, and the next credit bubble of reverse mortgages, equity lines expiring, and everyone cashing out their retirement to survive today.

Thu, 09/08/2011 - 17:08 | 1647797 Manthong
Manthong's picture

"masked by selling out the savers, retirees, taxpayers,"

Don't forget the little children.

Thu, 09/08/2011 - 16:35 | 1647675 Manthong
Manthong's picture

What we need is to give the PPT a few days off and let the market tank 20% to seal the deal and give the next policy action solid support and a good launch. 

Thu, 09/08/2011 - 16:22 | 1647633 mikmid
mikmid's picture

That's because it seem to be on the lead horse galloping down hill.

Thu, 09/08/2011 - 16:05 | 1647552 alien-IQ
alien-IQ's picture

has anybody noticed the absence of the once popular term, particularly when regarding unemployment, "lagging indicator"?

Thu, 09/08/2011 - 19:28 | 1648406 sgt_doom
sgt_doom's picture

"Lagging indicator"   LOL to the max...

Outstanding point --- evidently those phony econs belonging to the Bretton Woods Committee (brettonwoods.org) and/or on the Fed's payroll (all those consulting contracts they award to go-along faux econs)  apparently ain't doing the trick.

http://www.alternet.org/economy/142603/priceless:_how_the_federal_reserve_bought_the_economics_profession

 

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